Overcoming your financial fears can upgrade your life significantly. As you know, surviving in this world requires money. And many of us desire more than mere survival. However, neither making money nor managing money come easily to most people in the world. But don’t worry. It’s very possible to go from surviving to thriving simply by facing your financial fears.
As someone without formal financial education, I know this fear of finance well. And having educated myself the past few years, I see how much power to build wealth for ourselves, our families and our communities lies in financial literacy.
Recently I had lunch in Santa Monica with Financial Expert, Eva Macias. We began discussing our non-finance backgrounds and how we both learned to embrace the intimidation triggered by the topic. Eva told me how she decided to become a financial advisor when she found out her parents were retiring with combined retirement income of just $1,100. Her insights strongly resonated with me, and I think they will with many of you too.
Why Do We Fear?
The irony is that we love showing off what money can do for us. We’re constantly on social media sharing our globetrotting adventures, our fancy dinners and our designer clothes. Yet we run for the hills when it comes to learning how to make money sustainably and build wealth. Even people with advanced degrees may know how to earn income, but they often lack personal financial care. Why?
Based on Eva’s experiences with her clients, she gives several reasons why she thinks people are scared of their finances.
- Denial. We don’t want to hear the truth. We’re ashamed because our financial woes are partly our fault. We overspend and we’re not committed to our financial health.
- Judgment. We don’t want to be judged. We know our financial state doesn’t look pretty but we’re doing the best we can.
- Time. We don’t create the time to understand. We make excuses for not addressing our financial health by saying we’re too busy.
- Information paralysis. We get paralyzed by too much information and intimidating jargon. We grew up with little to no financial education requirements in school. And while there is a literal wealth of information right at our fingertips on the internet today, we don’t know where to start.
- Trust. We don’t trust ourselves to make the right decision. And we don’t find trustworthy mentors and advisors. By denying ourselves the opportunity to learn about our finances, we don’t trust that there may be simple solutions.
- Emotion. We’re scared to stray outside our comfort zone with financial decision-making. And we let emotions like guilt and love lead us to decisions that might not always be the most rational, practical or beneficial in the long-run. For example, is a prenup such a terrible thing?
All of these factors combined allow fear to reign, and we’re forced to make uninformed money decisions. Instead of finding reliable financial advice that applies to our specific situation, we default to making decisions based off the decisions of others without truly knowing whether it’s a good decision or not.
How to Overcome Your Financial Fears
Eva believes the primary way to overcome your financial fears is to embrace them. That’s the only way you’ll know where you stand financially and therefore the only way you’ll know how to move on up. Your situation might not be pretty, but it’s not the worst. After all, you’re still alive aren’t you? So, have faith in yourself and start tackling your financial issues one by one.
Many people yearn to live an abundant life. And Eva believes that by learning to manage your finances properly, you can. Financial security is a form of self-love that not only benefits you, but also everyone around you. Every money decision will come with a risk, but you can mitigate the risk significantly when your decisions are informed.
Financial independence is especially critical for women since they face much higher risk of poverty than men. You can’t assume the government, your parents or your spouse will always be there to support you. So, empower yourself. Be responsible for yourself. Become financially fearless. And live abundantly ever after!